Coronavirus: DA petitions IMF to stop govt using B-BBEE as business relief fund criteria

2020-05-07 14:29

The DA is taking its fight against the government using B-BBEE status as criteria for SMME funding relief to the International Monetary Fund (IMF).

In a statement on Thursday, DA interim leader John Steenhuisen said he had written a petition to IMF managing director Kristalina Georgieva, opposing the use by the South African government of coronavirus disaster relief funds in a "racially discriminatory" way.

Last week, the party filed papers in the Western Cape High Court for urgent relief to prevent, what it said was, an unlawful use of B-BBEE status, race, gender, age or disability as criteria in relation to economic or other forms of relief or assistance.

"As the majority of these relief funds come from a loan obtained from the IMF, I implore this international body to censure the South African government and instruct it to stop using IMF monies in a way that discriminates along racial lines, and exacerbates racial tension in South Africa," Steenhuisen said, adding that the ANC government's support of B-BBEE compliant companies, at a time of national economic crisis, was unconscionable.

READ: DA to go to court over race based covid-19 relief

In April, President Cyril Ramaphosa announced that the government would seek help from the IMF and World Bank in its quest to raise R500 billion towards a Covid-19 social and economic plan.

The money will go towards municipalities for provision of services, grants for relieving the plight of the poorest, funding for job creation, tax relief for distressed businesses, assistance for spaza shops and small businesses, and a loan guarantee scheme for qualifying businesses.

Treasury has projected that up to seven million South Africans may lose their jobs as a result of the nationwide lockdown, in its worst-case scenario. This would catapult SA's unemployment rate to well over 50%.

ALSO READ: Mboweni says state should support all businesses if viable irrespective of race

On Tuesday, Finance Minister Tito Mboweni said that South African businesses, regardless of race, should receive state support, with a "bias towards emerging black business people".

"The race of a business owner has no bearing on the race of the employees of the business. White-owned businesses have black employees, who in turn support families. By deliberately denying these businesses critical government relief, it is not just the owner of the business, but indeed these families who will suffer should the business fail.

"I have no doubt that the IMF had no intention of fuelling racial discord in South Africa. I trust that the IMF will not hesitate in directing the South African government to not use its loan financing in a way that furthers racial discrimination," Steenhuisen said.

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Read more on:    imf  |  da  |  cyril ramaphosa  |  john steenhuisen  |  lockdown  |  coronavirus  |  economy  |  politics
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